Big Bust in Jersey: Johathan Dienst and Michael Clancy from NBC report that 40 people, including several elected officials were arrested in New Jersey this morning by agents from the FBI and IRS as part of a crackdown on widespread corruption.  Among those arrested were a member of the state assembly and the mayors of Secaucus, Hoboken, the Deputy Mayor of Jersey City, a council member, and several area rabbis.  Those arrested are suspected of involvement in international money laundering, bribes and an illegal human organ-selling ring. 

Inmate Release Almost Kills CA Budget Deal:  The budget compromise announced by California's Governor and legislative leaders on Monday was almost derailed when GOP lawmakers learned that part of the deal involved the release of 27,000 inmates from prison.  Sacramento Bee writer Steve Wiegand reports that, to save the compromise, Democrat majority leaders have postponed a vote on the inmate release plan until August.   The other 28 bills in the budget package are expected to be adopted by both legislative houses this week and Governor Schwarzenneger, who brokered the compromise, has pledged to sign them.  Senate President Pro Tem Darrell Steinberg, D-Sacramento, said that there was no intent by the Democrats or the governor to change the release plan before the August vote, but the Assembly Republican leader said that his party will introduce a countermeasure that will not involve the release of dangerous prisoners.